Stocks retreat as Greece concerns overshadow stimulus bets

Stocks trended lower on Monday as investors locked in profits from last week ahead of the upcoming meeting of the Federal Reserve Board.

The Dow Jones Industrial Average fell 52.35 points to 13,254.29. The Nasdaq Composite Index was down 32.40 points to 3,104.02, and the S&P 500 Stock Index lost 8.84 points to 1,429.08.

The Fed meets on Wednesday and Thursday to review current economic conditions and possibly take steps to avoid a new recession. Economic data this week includes reports on inflation and retail sales.

Gold fell $8.70 to $1,731.80 an ounce after gaining 3.1 percent last week. Oil rose 12 cents to $96.54 a barrel.

Intel Corp. (Nasdaq: INTC) lost 3.8 percent after Morgan Stanley (NYSE: MS) cut its earnings forecasts and Nomura Holdings Inc. (NYSE: NMR) said estimates for the largest chip-maker’s profit next year may fall further. Apple Inc. (Nasdaq: AAPL) dropped 2.6 percent as technology shares tumbled 1.3 percent. International Paper Co. (NYSE: IP) slid 4.2 percent after Deutsche Bank AG (NYSE: DB) cut its rating, saying expected price increases may not happen.

“Europe will continue kicking the can down the road, and there’s no quick solution,” said Walter “Bucky” Hellwig, who helps manage $17 billion at BB&T Wealth Management in Birmingham, Ala. “Macro numbers have been very unimpressive, but there’s this aspect of expansionary monetary policy decisions that have been driving prices higher. The market will turn on what the Federal Reserve does this week.”

The S&P 500 climbed last week to a four-year high after the European Central Bank approved a bond-buying plan and investors bet Fed Chairman Ben Bernanke will continue to support economic growth. The equities index is 20 percent above its level on Sept. 15, 2008, the first trading day after Lehman Brothers Holdings Inc. filed the world’s biggest bankruptcy and prompted a 46 percent drop through March 9, 2009. The gauge is less than 10 percent from its record closing high after rising 14 percent this year.

Stocks declined earlier Monday as Greek Prime Minister Antonis Samaras met officials from the nation’s creditors after failing to secure agreement from coalition partners on spending cuts. Greece’s Democratic Left leader Fotis Kouvelis, whose party is one of the three in the coalition government, said that no decision had been made on the cuts required to obtain further aid for the country’s bailout, and that poorer citizens must be protected from austerity measures.

Germany’s Federal Constitutional Court is due to rule on the country’s participation in the European Stability Mechanism, a permanent 500 billion euro fund that offers loans to member states and may buy their bonds to lower borrowing costs.

Technology, financial and industrial companies posted the biggest losses Monday out of 10 groups in the S&P 500, erasing at least 0.7 percent. Bank of America Corp. (NYSE: BAC) sank 2.5 percent to $8.58. Boeing Co. (NYSE: BA) dropped 2.5 percent to $71.08.

American International Group Inc. (NYSE: AIG) retreated 2 percent to $33.30. The U.S. Treasury is offering to sell $18 billion of shares in a transaction that may cut taxpayers’ stake in the firm to below 50 percent for the first time since its 2008 bailout. The insurer plans to buy back as much as $5 billion of the shares, and Citigroup Inc. (NYSE: C), Deutsche Bank AG, Goldman Sachs Group Inc. (NYSE: GS) and JPMorgan Chase & Co. (NYSE: JPM) are managing the sale, the Treasury said Sunday in a statement.

Titan Machinery Inc. (Nasdaq: TITN) plunged 23 percent to $19.41 and reduced its forecast for 2012 earnings. It estimates profit to be no more than $2.30 a share, compared with an earlier prediction of at least $2.55 a share. The company also reported second-quarter earnings of 25 cents a share, missing the average analyst estimate of 43 cents.